The biodesign and biofabrication of self-generated biomaterials based on lignocellulosic plant residues and by fungal mycelium is an emerging field of research for the last two decades. A new material culture emerges based on the new paradigms of alternative manufacturing founded on the logic “of growing new materials instead of extracting them” that integrates the basic principles of the circular economy and Material Biotechnology, ensuring susceptibility of them to be biodegraded and returned to their original state in nature. Its implementation at an industrial level in different manufacturing areas begins to compete with animal origin-leather, materials, and petrochemical products while promoting new alternatives of sustainable protein foods that contribute to changing high human consumption patterns globally entrenched environmental impact. This review addresses a detailed overview from the molecular to the global of the new mycelial culture, considering general features about Fungi kingdom, the morphogenesis, chemical composition, and cellular integrity of the mycelium, the extracellular multi-enzymatic systems for the lignocellulose degradation, passing through the primary substrates used, the biomaterials developed from fungal mycelium at the industrial level; highlighting biotextiles, materials and products for packaging and insulation, new mycelium-based food sources, art, and architectural design. Finally, a current state-of-the-art of frontlines companies or laboratories promoting a circular economy based on fungal mycelium is addressed by replacing resources and fossil origin products with environmentally friendly materials, generating sustainable alternatives and production cycles with low energy demand and without environmental repercussions, that is to say, promoting a new material consciousness.